The corporate watchdog has launched a formal investigation into DroneShield, scrutinising the ASX-listed drone ‘gun’ company’s disclosures about a $67 million share sell-off by its former chief executive and two directors that wiped more than 30 per cent from its share price last November.
DroneShield told the market on Tuesday morning that the Australian Securities and Investments Commission had issued a notice requiring it to provide reasonable assistance with an investigation under the Corporations Act, relating to announcements and share trading in November last year.
The moves pushed DroneShield’s shares down as much as 15 per cent to $2.99 on Tuesday, capping a bad run for the company that had capitalised on renewed interest in defence stocks to skyrocket in value before losing about half of its value since its peak in October 2025.
DroneShield said in a statement to investors that “it is not clear what action, if any, may result from ASIC’s investigation”, which it said covered the specific periods when its former leaders sold shares. An ASIC spokesperson confirmed an investigation was ongoing but declined to comment further while the matter was active. DroneShield declined to add to its statement.
The probe lands at a sensitive moment for the Sydney-based defence technology outfit, which last month installed Angus Bean as managing director and chief executive after the abrupt April resignation of long-serving chief executive and managing director Oleg Vornik.
Veteran chair Peter James, who has led the board since DroneShield’s 2016 listing, will not seek re-election at the company’s upcoming AGM later this month. REA Group chair and former Network Ten chief executive Hamish McLennan, who has more recently presided over radio company ARN’s battle with its former star presenters Kyle Sandilands and Jackie ‘O’ Henderson, has been named as his replacement.
The Sydney-based company develops artificial intelligence-powered hardware and software designed to detect, track and disable hostile drones, with products including the handheld DroneGun and fixed-site DroneSentry systems. Its technology has been deployed across more than 40 countries – including in Ukraine, where it has been used against Russian drone attacks – and sold to militaries, intelligence agencies, police forces, airports and critical infrastructure operators.
DroneShield’s unravelling began on November 10 last year, when the company announced $7.6 million in fresh US government contracts. The disclosure pushed shares 8.5 per cent higher before a trading pause. Hours later, DroneShield retracted the announcement, telling investors the orders had been “inadvertently marked as new contracts rather than revised contracts due to an administrative error”.
Two days later, Vornik sold his entire stake in the company – $49.5 million worth of shares acquired through performance options that had vested when DroneShield hit a $200 million rolling revenue threshold. James offloaded $12.4 million in stock and non-executive director Jethro Marks sold $4.9 million. The combined $66.8 million sell-off, executed between November 6 and 12, sent the share price into a 31 per cent freefall.
James previously told this masthead his sales were primarily to fund tax obligations triggered by the vesting. “My share sales were primarily to settle tax liabilities associated with the performance share plan,” he said.
“I’ve been in the tech sector for a very long time and have always said that you never stop learning. We reflected on that deeply and initiated the governance review, the detail of which was published to the ASX over December and January.”
Vornik, who is staying on as an adviser through to mid-year, has previously said his sales also funded home renovations. He did not appear at scheduled engagements at the Forbes Australia Business Summit or an Australian Computer Society event in the days following the sell-off.
DroneShield declined comment requests on behalf of Vornik and James.
Bean, a decade-long DroneShield employee who ran the product team before stepping up, said his focus was on growth rather than governance noise.
“I’ll continue the vision of DroneShield being an Australian success story,” he told this masthead in April. “My focus will continue to be ensuring we are bringing the technology that will help our end-users combat the growing drone threat, and I hope I bring a new energy to the role.”
DroneShield was added to the ASX 200 in September last year after a stunning run that took its share price to a peak of $6.60 on October 9, 2025. Its shares are well off those highs but still up roughly 120 over the past year.
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David Swan is the technology editor for The Age and The Sydney Morning Herald. He was previously technology editor for The Australian newspaper.Connect via X or email.